Why postal workers need your support

A battle is looming at the U.S. Postal Service. Nicole Colson reports on what's at stake.

September 19, 2011

THE U.S. Postal Service (USPS) may soon lay off 120,000 employees--the worst attack ever on U.S. postal workers if it goes through, and the biggest offensive yet in the war on public-sector unions across the country.

This attack should be a call to action for all of organized labor. Everyone who cares about social justice and workers' rights should step forward and offer their solidarity to postal workers during the national day of action called for September 27.

Postal Service officials claim the job cuts are necessary as a result of a budget shortfall that will lead to a default on a $5.5 billion payment to finance retirees' future health care benefits, which is due on September 30. The Postal Service faces an overall $10 billion deficit for this fiscal year, following an $8.5 billion loss in 2010.

According to the New York Times, at a recent Senate hearing:

Postmaster General Patrick R. Donahoe testified that even with a three-month reprieve on the $5.5 billion payment, the post office was likely to run out of cash and face a shutdown next July or August unless Congress passed legislation that provided a long-term solution for the ailing agency...

"The Postal Service is on the brink of default," Mr. Donahoe testified. "The Postal Service requires radical change to its business model if is to remain viable in the future."

What you can do

Postal unions will rally in congressional districts across the country on September 27 from 4-5:30 p.m. Visit Save America's Postal Service for a complete list of rally locations.

So what is Donahoe's "long-term" solution? Lay off more than one-fifth of the post office's largely minority workforce in the midst of the ongoing effects of the worst economic crisis since the Great Depression.

Postal officials are also considering eliminating Saturday delivery, closing 3,700 local post office branches across the country and moving employees to "cheaper"--translation: inferior--health care plans. In all, the agency wants to remove 480,000 retirees and 600,000 employees from more expensive federal health insurance plans.

Existing postal union contracts bar such mass layoffs. So the Postal Service is now asking Congress to pass a special law specifically to overturn the no-layoff clauses in the unions' contracts. If Congress approves this measure, it will signal an all-out attack on postal workers--a battle with high stakes not only for the organized labor movement, but working people everywhere.

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POSTAL UNION members are furious at this anti-union onslaught. As Cliff Guffey, president of the American Postal Workers Union (APWU), told the New York Times, "These proposals are outrageous, illegal and despicable."

Guffey pointed out that the APWU already agreed to $3.7 billion in givebacks in a contract signed in May to help the Postal Service cut costs. In return, the union specifically wanted no-layoff provisions preserved in its contract. "To unilaterally abrogate what we gained is totally contrary to the duty to bargain collectively," Guffey said.

The attack on postal workers should be seen as part and parcel of the attacks on public-sector workers taking place across the U.S.

The proposed layoffs and cuts at the Postal Service would be particularly devastating to African American workers, who historically make up a large part of the postal workforce. As Michelle Balani noted in an article for TheGrio.com:

According to Philip Rubio, author of There's Always Work at the Post Office: African American Postal Workers and the Fight for Jobs, Justice and Equality, by 1970, Blacks made up one-fifth of the postal workforce and "were twice as likely to work at the post office than whites," which paved the way for many other minorities to seek employment by the agency. The potential cuts of 20 percent of the Postal Service workforce and the slashing of benefit programs have left many wondering what effect it will have on those in the Black community who depend on the USPS for their livelihoods.

Currently, minorities account for some 39 percent of all post office workers, with African Americans accounting for 21 percent, or around 124,000 workers. According to CNN, last year, Black Enterprise magazine praised the service as one of the top 40 companies in the U.S. for diversity.

It was a job that brought status, security, decent pay and benefits, and elevated many African Americans into the middle class, enabling them to buy homes and send their children to college. The proposed U.S. Postal Service layoffs and post office closures--harmful to the nation as a whole--would therefore be especially devastating to the African American community.

The proposed layoffs come as the official unemployment rate for African Americans reached 16.7 percent--a 25-year-high--and the official poverty rate for African Americans rose to 27.4 percent.

In addition, the Postal Service is the single-largest employer of veterans, who make up 22 percent of the workforce, a total of 130,000 employees. Of those veterans, approximately one-third--49,000--are disabled.

Its historically diverse workforce is something that postal officials have long celebrated. In May, for example, a press release from the Postal Service announced that it had been voted America's "No. 1 government agency for providing multicultural business opportunities," and that it was committed to "employee diversity."

But as Balani pointed out, "[T]he proposed layoffs have the potential to send some Black households spiraling into a chasm of financial uncertainty."

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ACCORDING TO the APWU, the "crisis" that the Postal Service claims it is facing is not what it appears to be.

It's true that the Postal Service has lost business to competitors such as UPS and FedEx, and mail volume has declined, especially as e-mail has become more prominent. However, the Postal Service has not received a single dime of taxpayer money since the 1970s and is legally limited to raising prices in line with inflation.

While Republicans in particular push for the Postal Service to be privatized, they conveniently ignore the fact that FedEx especially has been able to expand its operations to become the world's top express delivery service largely thanks to the political contributions it continually doles out to both parties.

Strong ties to the White House and members of Congress allow FedEx special access. As the Center for Responsive Politics noted:

In exchange [for campaign donations], the company has gotten unparalleled access to debates over international trade, tax cuts and rules that govern the business practices of its one-time competitor, the United States Postal Service. In 2001, FedEx cemented a groundbreaking deal with the USPS to deliver all of the post office's overnight packages and express deliveries. In turn, FedEx was allowed to put its drop boxes in post offices around the country.

In other words, Congress has helped cripple the Postal Service and give a leg up to its competitors–but is now faulting the Postal Service for supposedly not being "competitive" enough. Even so, the USPS still delivers 40 percent of global mail, with less than 600,000 workers.

Postal unions claim that there's another culprit in the postal crisis: a law passed in 2006--the Postal Accountability and Enhancement Act (PAEA)--which requires that the Postal Service fund 100 percent of pensions for all employees for 75 years by 2016 and fully fund retiree health care in advance.

The unions say that a decades-old accounting error has led the Office of Personnel Management to overcharge the Postal Service by billions of dollars for payments into the Civil Service Retirement System (CSRS). They point to a January 2010 report from the Postal Service Office of Inspector General that stated the Postal Service has, since the 1970s, overpaid into the CSRS by some $75 billion.

The report stated that the overcharge benefited the U.S. Treasury and recommended that the Treasury credit $75 billion to the Postal Service. A separate study commissioned by the Postal Regulatory Commission concluded that the USPS has overpaid between $50 billion and $55 billion. Additionally, the Postal Service has a $6.9 billion surplus in the Federal Employee Retirement System.

According to APWU President Cliff Guffey:

Fortunately, there is a solution to this problem. The Postal Service should be permitted to use the surplus in its two pension funds to cover the cost of its future retiree health obligations...This would not be a bailout. It would allow the USPS to use its revenue from postage to meet the congressional mandate, and it would not require any taxpayer contributions.

Postal unions say that surplus CSRS and FERS overpayments should be transferred to the Postal Service's retirement health fund, and that doing so would not impact the pre-funding of future pensions.

But congressional Republicans are pushing hard to dismantle the postal unions' contracts anyway--and privatize one of the largest federal employers.

According to California Rep. Darrell Issa, who is leading the charge, the Postal Service's potential default "would not be tolerated in a private company...USPS needs fundamental structural and financial reforms to cut costs and protect taxpayers from an expensive bailout."

But the real federal bailouts came in the form of the trillions of taxpayer dollars handed out to Wall Street over the past several years--with the support of the majority of Republican and Democratic lawmakers alike. Likewise, the vast majority of private companies never fully fund pension or health care obligations in advance--among the few that still offer defined-benefit pensions and retiree health care, that is.

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AT HEART, the attack coming from Issa and other congressional lawmakers is not about phantom "bailouts"--but fundamentally restructuring the Postal Service, privatizing services and busting the postal unions.

Issa, according to the APWU, is currently pushing a bill that "would destroy the Postal Service as we know it." The bill:

would do nothing to correct the cause of the USPS financial crisis: It would do nothing about the pension overpayments or the pre-funding requirement. But it would establish a "solvency authority" with the power to unilaterally cut wages, abolish benefits and end protection against layoffs. It also would create a board that would order $1 billion worth of post office closures in the first year and $1 billion worth of facility closures in the second year. If H.R. 2309 is enacted, thousands of offices throughout the country would be closed.

In other words, Issa's bill is one more in the long line of assaults on the collective bargaining rights of public-sector unions. His model seems to be the Michigan law that empowers "Emergency Financial Managers" to override the decisions of underfunded local governments and tear up union contracts. If Issa's bill were to pass, the postal unions would become legally defunct.

The suggestions by Postmaster General Donahoe, however, are little better. He also wants to impose mass layoffs, tear up union contracts and eliminate defined-benefit pensions for new hires altogether, replacing them with 401(k) plans. Donahoe's plan for closing post offices is based on the revenue they produce--which means that poor rural and inner-city areas will be hit hardest.

But there is nothing "humane" about laying off 120,000 employees from one of the most diverse U.S. workforces in the midst of the worst economic crisis in decades.

In response to the attacks being waged on them from all sides, postal workers in the APWU, National Association of Letter Carriers, National Postal Mail Handlers Union and National Rural Letter Carriers Association are planning to rally in congressional districts across the country on September 27 to build support for a rival bill introduced in the House by Democratic Rep. Stephen Lynch, which would alter the methodology for allocating the Postal Service's share of pension costs for retirees and direct any surplus from the CSRS to the Postal Service Retiree Health Benefits Fund.

"With the USPS's dire financial situation making headlines and a battle raging in Congress over what to do about it, postal workers must take action now," said the APWU's Guffey. "I urge APWU members to work with our brothers and sisters in the other postal unions to organize the rallies. We must let every U.S. representative know that we need their support."

As a recent resolution from the San Francisco Labor Council noted, "Like Reagan's attack on PATCO, this is an attack on all of labor, and labor needs to close ranks with every community now to defend the postal unions and save the public Postal Service."